Why I’m Not Abandoning my Financial Advisor Anytime Soon

I’ve been a do-it-yourself investor for quite a few years now, and I’ve never regretted that decision. I initially switched my investments from mutual funds to TD e-Series funds. But at the start of the year, I switched again to exchange traded funds to lower my management expense ratio (MER). I’ve calculated that I’ll likely save close to $100,000 (that’s not a typo) over the course of my investment years, but I recently realized that a financial advisor still plays an important role in my life.

You see, despite all I’ve learned about investing, I can’t do everything on my own. I trust my investment decisions, but I still need a little hand holding just to confirm that I’m doing alright. I could probably have figured out all of this on my own, but it probably would have taken me too much time, and there’s a good chance I may have still doubted my numbers. To give me peace of mind, I sought the advice of a fee-only, advice only financial advisor and I’ve never been happier

Going beyond DIY investing

As a personal finance blogger, I often focus on MERs since they’re a huge drain on your portfolio. Casual investors now have access to robo-advisors which make investing so much easier, but having a low MER isn’t enough to secure your financial future.

After taking care of my investments, I turned my attention towards my insurance needs. This was especially important since my wife and I had become homeowners, so we wanted to make sure we had everything in order in the event one of us passed suddenly.

My wife and I were in a fortunate situation where we had no debt beyond our mortgage, and we had a pretty healthy emergency fund saved up. One thing we had not yet taken care of was our wills. This is honestly something that I need to take care of as soon as possible since my wife and I recently had a baby girl.

Although it appeared that my wife and I were financially secure, I’ve been worried about my job situation for some time now. I work in an industry that has seen massive job losses over the years, and it’s only a matter of time before my job is at risk. I realized that I needed a financial advisor to look at all my numbers and come up with a solid plan that I could follow.

They’re worth paying the fee

Most people avoid using a fee-only financial advisor because of the fee. Admittedly, paying $1,500 – $2,500 for a financial plan may seem like a lot, but I’m getting a detailed outlook of my future which I think is worth paying for.

When I spoke to my advisor, we went over everything. He agreed that our savings rate was high and we had positioned ourselves well. Of course, he also stated that I should look into estate planning and explained why a simple will might not be in our best interests.

The most important conversation we had was what my wife and I had planned for the future. We had briefly discussed that retiring at 55 would be ideal and helping our daughter with her education costs, her eventual wedding, and possibly a home down payment for her.

I’m going to simplify things here, but after having one more conversation with my advisor, he projected our numbers with a few different scenarios. He looked at our finances and how they would be affected if my salary decreased (due to a job loss), plus how things looked if I retained my job for a few more years (I’ve flirted with working just part-time in the future).

Essentially for this one-time fee, my wife and I have been given a pretty accurate outlook of our future. It may seem insane to plan that far in the future, but if we don’t have a plan, how can we realistically meet our goals?

Final word

Despite the fact that our advisor has given us everything we need, I’ll likely consult him from time to time. Life events can happen at any time which is why I’m not abandoning my financial advisor anytime soon.

By | 2017-11-15T15:48:28+00:00 October 30th, 2017|My Money, Personal Finance|

5 Comments

  1. Vito October 31, 2017 at 12:32 am - Reply

    Hey Barry,

    Great article. I was wondering if you could share who your advisor is or at least the agency/company? I don’t think I’m at the point where I will need one just yet, but the one I have heard great things about and read A LOT of his articles on Moneysense, is Jason Heath.

    Hope you’re well 🙂

  2. Dan November 6, 2017 at 10:36 am - Reply

    Hi Barry,
    Great blog! I just stumbled upon while searching for, and trying to understand how my MER affects my future! Wow!
    I was wondering if you could write a blog post on how you would go about choosing a fee only advisor like you have. What kind of questions would you ask them, and what sort of services did you find valuable vs. fluff?
    Thanks!
    Dan

  3. Becca Holton November 15, 2017 at 3:21 pm - Reply

    Barry, this gave me a few things to take into consideration as I make my choice.I’ve been considering getting a financial adviser. That’s why I appreciated that you shared your experience.

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